[2016] FWC 3100

FAIR WORK COMMISSION

DECISION

Fair Work Act 2009
s.185 - Application for approval of a single-enterprise agreement

Sparta Mining Services Pty Ltd
(AG2016/2507)

COMMISSIONER SPENCER

BRISBANE, 5 JULY 2016

Application for approval of the Sparta Mining Services Pty Ltd Enterprise Agreement 2016.

Introduction

[1] This Decision relates to an application made pursuant to section 185 of the Fair Work Act 2009 (the Act) by Sparta Mining Services Pty Ltd (the Applicant/Sparta) for the approval of the Sparta Mining Services Pty Ltd Enterprise Agreement 2016 (the proposed Agreement/the Sparta Agreement).

[2] The Applicant submitted that the Agreement met all of the statutory tests and therefore must be approved.

[3] The Construction, Forestry, Mining and Energy Union (the CFMEU/the Union), whilst not a bargaining representative, sought to intervene in the proceedings and opposed the application on the basis that the Agreement did not meet the statutory approval tests under the Act. The Applicant submitted that the employees to be covered by the Agreement were production and engineering employees working at black coal mine sites in Queensland and New South Wales.

[4] The Union argued a relevant matter to the approval of this Agreement was the related corporate entity of Sparta Mining Services Pty Ltd, being Spartan Mining Services (Spartan), which the Union stated was a contracting company, also operational in the coal industry, which was not currently covered by an enterprise agreement. The Union pointed to the close connection not only in name between the associated corporate entities of Sparta and Spartan, but also to a common management team, same premises, and the same email addresses 1.

[5] The Applicant was represented by Mr John Merrell, Counsel and instructed by Mr Scott McSwan, solicitor, McKays Solicitors. The CFMEU opposed the approval of the Agreement and was represented by Mr Adam Walkaden, Legal Officer of the Union.

Permission to intervene

[6] In summary terms, the Union sought permission to intervene pursuant to section 590 of the Act and relied on the Full Bench decision in CFMEU v Collinsville Coal Operations Pty Limited (Collinsville). 2 The Union submitted that this Decision considered the right to be heard, by a party that was not a bargaining representative, and that section 590 provides a broad power that enabled the Commission to inform itself as it considers appropriate. The Union argued that the Commission’s broad discretion, pursuant to section 590 of the Act, should be exercised to allow the Union’s intervention, in this matter. The application for intervention was made on a number of bases, including that the CFMEU had a significant number of members employed by the associated entity of Spartan Mining Services. The Union argued that the effect of the approval of this Agreement on their members in this industry must be taken into account. That is, it was argued, that the approval of this Sparta Agreement, will act as a comparator agreement within the corporation and the industry, placing immediate pressure on the wages and conditions of CFMEU members employed by Spartan.

[7] The Union also argued that the Agreement had been made with a very small number of employees, even though it was not a start-up company. It was alleged by the Union to be 'a phoenix arrangement’ between the Spartan and Sparta entities. Accordingly, the Union submitted that the Agreement should be fully scrutinised. Thirdly, it was argued that, given that the CFMEU had a significant presence in the industry and the fact that there was an absence of a contradictor in this application, and based on their submission that the Agreement did not meet the Better off Overall Test (BOOT), their application for permission to intervene, should be granted.

Relevant statutory provisions

[8] The Act sets out the relevant statutory provisions as follows:

590 Powers of FWA to inform itself

(1) FWA may, except as provided by this Act, inform itself in relation to any matter before it in such manner as it considers appropriate.

(2) Without limiting subsection (1), FWA may inform itself in the following
ways:

(a) by requiring a person to attend before FWA;

(b) by inviting, subject to any terms and conditions determined by FWA, oral or written submissions;

(c) by requiring a person to provide copies of documents or records, or to provide any other information to FWA;

(d) by taking evidence under oath or affirmation in accordance with the regulations (if any);

(e) by requiring an FWA Member, a Full Bench or the Minimum Wage Panel to prepare a report;

(f) by conducting inquiries;

(g) by undertaking or commissioning research;

(h) by conducting a conference (see section 592);

(i) by holding a hearing (see section 593).

[9] Section 186 of the Act sets out the general requirements for when the Commission must approve an enterprise agreement.

186 When FWA must approve an enterprise agreement--general requirements

Basic rule

(1) If an application for the approval of an enterprise agreement is made under subsection 182(4) or section 185, the FWC must approve the agreement under this section if the requirements set out in this section and section 187 are met.

Note: The FWC may approve an enterprise agreement under this section with undertakings (see section 190).

Requirements relating to the safety net etc.

(2) The FWC must be satisfied that:

(a) if the agreement is not a greenfields agreement—the agreement has been genuinely agreed to by the employees covered by the agreement; and

(b) if the agreement is a multi-enterprise agreement:

(i) the agreement has been genuinely agreed to by each employer covered by the agreement; and

(ii) no person coerced, or threatened to coerce, any of the employers to make the agreement; and

(c) the terms of the agreement do not contravene section 55 (which deals with the interaction between the National Employment Standards and enterprise agreements etc.); and

(d) the agreement passes the better off overall test.

Note 1: For when an enterprise agreement has been genuinely agreed to by employees, see section 188.

Note 2: FWA may approve an enterprise agreement that does not pass the better off overall test if approval would not be contrary to the public interest (see section 189).

…

(underline added)

[10] Section 187 contains additional requirements for the approval of enterprise agreements:

187 When FWA must approve an enterprise agreement--additional requirements

Additional requirements

(1) This section sets out additional requirements that must be met before FWA approves an enterprise agreement under section 186.

Requirement that approval not be inconsistent with good faith bargaining etc.

(2) FWA must be satisfied that approving the agreement would not be inconsistent with or undermine good faith bargaining by one or more bargaining representatives for a proposed enterprise agreement, or an enterprise agreement, in relation to which a scope order is in operation.

Requirement relating to notice of variation of agreement

(3) If a bargaining representative is required to vary the agreement as referred to in subsection 184(2), FWA must be satisfied that the bargaining representative has complied with that subsection and subsection 184(3) (which deals with giving notice of the variation).

Requirements relating to particular kinds of employees

(4) FWA must be satisfied as referred to in any provisions of Subdivision E of this Division that apply in relation to the agreement.

Note: Subdivision E of this Division deals with approval requirements relating to particular kinds of employees.

…

[11] Section 188 lists the factors that the Commission must be satisfied of in relation to an enterprise agreement having been genuinely agreed to:

188 When employees have genuinely agreed to an enterprise agreement

An enterprise agreement has been genuinely agreed to by the employees covered by the agreement if FWA is satisfied that:

(a) the employer, or each of the employers, covered by the agreement complied with the following provisions in relation to the agreement:

(i) subsections 180(2), (3) and (5) (which deal with pre-approval steps);

(ii) subsection 181(2) (which requires that employees not be

(iii) requested to approve an enterprise agreement until 21 days after the last notice of employee representational rights is given); and

(b) the agreement was made in accordance with whichever of subsection 182(1) or (2) applies (those subsections deal with the making of different kinds of enterprise agreements by employee vote); and

(c) there are no other reasonable grounds for believing that the agreement has not been genuinely agreed to by the employees.

[12] Section 193 of the Act contains the Better off Overall Test:

193 Passing the better off overall test

When a non-greenfields agreement passes the better off overall test

(1) An enterprise agreement that is not a greenfields agreement passes the better off overall test under this section if FWA is satisfied, as at the test time, that each award covered employee, and each prospective award covered employee, for the agreement would be better off overall if the agreement applied to the employee than if the relevant modern award applied to the employee.

…

Award covered employee

(4) An award covered employee for an enterprise agreement is an employee who:

(a) is covered by the agreement; and

(b) at the test time, is covered by a modern award (the relevant modern award ) that:

(i) is in operation; and

(ii) covers the employee in relation to the work that he or she is to perform under the agreement; and

(iii) covers his or her employer.
Test time

(5) The test time is the time the application for approval of the agreement by the FWC was made under subsection 182(4) or section 185.

….

FWC may assume employee better off overall in certain circumstances

(7) For the purposes of determining whether an enterprise agreement passes the better off overall test, if a class of employees to which a particular employee belongs would be better off if the agreement applied to that class than if the relevant modern award applied to that class, the FWC is entitled to assume, in the absence of evidence to the contrary, that the employee would be better off overall if the agreement applied to the employee.

…

(underline added)

Submissions and Considerations

Permission to Intervene

[13] The Applicant opposed the Union’s intervention application in the matter, on the basis that these issues had been dealt with in the Collinsville Decision. In summary terms, in response to the first argument of the CFMEU’s three arguments advanced (that it had a demonstrable right, interest or legitimate expectation in the decision to approve the Sparta Agreement on the basis that it had members employed in the related entity Spartan and that this related company had no enterprise agreement), the Applicant argued that the CFMEU was not a bargaining representative for the Sparta Agreement and therefore cannot be a party (pursuant to section 185(1) of the Act) to the application for approval of the Agreement, and cannot give written notice pursuant to section 183 of the Act, to be covered by the Sparta Agreement, if approved by the Commission.

[14] The Applicant relied on the Collinsville decision, to submit that, there was no provision in the Act which permitted a non-party to intervene in proceedings before the Commission. However, the Applicant acknowledged that section 590 of the Act provided a broad discretion to the Commission, to inform itself, in relation to any matter in a manner that it considers appropriate. It was considered by the Applicant that this included that the discretion may be exercised, with respect to hearing from an employee organisation, regarding the approval of an enterprise agreement, in circumstances where they otherwise may not have a right to be heard. 3

[15] Secondly, the Union submitted that a small number of employees that voted on the Agreement, which therefore justified a fully contested hearing, to assess the Agreement. I note the requirement under section 172 of the Act, that there be at least 2 employees:

“172 Making an enterprise agreement

…

Requirement that there be at least 2 employees

(6) An enterprise agreement cannot be made with a single employee.”

[16] The requirement that there are two or more employees has been met.

[17] However, the Applicant stated that the CFMEU’s first and third arguments (the Union’s significant presence in the industry and absence of another ‘contradictor,’), where the Union relied on a demonstrable right, interest, or legitimate expectation as the basis, to be granted permission to intervene and the CFMEU’s standing in the coal mining industry, were all matters that had been dealt with and rejected by the Full Bench in the Collinsville decision. The Applicant’s submissions are extracted as follows: 4

“In Collinsville, the arguments by the CFMEU, as recorded by the Full Bench were (footnote omitted):

As to the CFMEU’s rights that are said to be affected, the CFMEU submitted, in summary, that the decision to approve the Agreement will affect its right to represent employees at the mine and for these employees to be members of the CFMEU. Further, it will affect its capacity to protect terms and conditions of employment. Other rights relied on by the CFMEU are identified earlier and are not reproduced here.

The Full Bench rejected these arguments, by holding, in part:

In our view this argument has no substance. Firstly, the argument presupposes that the CFMEU has some particular right which will be taken away or interfered with, if the Agreement is approved. The CFMEU’s entitlement to represent the industrial interests of employees at the Collinsville coal mine is to be derived from the CFMEU’s rules. The approval of the Agreement will not interfere with that. Before the Agreement was approved, the terms and conditions of the employees covered by the Agreement were determined, inter alia, by the Black Coal Mining Industry Award 2010, the applicable modern award. Under the dispute settlement procedure of the modern award the CFMEU has no particular right of representation. Representation may be sought by employees in relation to disputes and in relation to consultation. Under the modern award employees choose their representation. They may choose the CFMEU. That position is not changed by approval of the Agreement. Employees may choose to be represented by the CFMEU in disputes under the Agreement and in consultation matters. In any event such rights are vested in the employees not in the CFMEU. The Modern Award is not a respondency award made in settlement of an interstate industrial dispute involving the CFMEU. The statutory basis and constitutional underpinning of modern awards are significantly different to awards made under predecessor legislation in settlement of disputes.

Secondly, the Agreement does not affect the rights of an employee covered by it to choose whether he or she wishes to join, continue to be or cease to be, a member of the CFMEU.

Thirdly, the approval of the Agreement does not affect the right of the CFMEU to be involved in bargaining for any successor or replacement agreement, nor does it affect the right of the CFMEU to represent employees more broadly engaged in the coal mining industry or to advocate for improvements to the terms and conditions under which those employees are employed.
…

In similar vein, that an employee organisation has amongst its interests, objects or
expectations, that it will obtain and maintain reasonable employment conditions for its
members, is in the context of the bargaining framework established by the FW Act, an
insufficient basis for there to arise a right, interest or legitimate expectation and thereby a conferral on the employee organisation of a right to be heard in relation to an application to approve an enterprise agreement.

Account should also be taken of the fact that enterprise agreements may confer or deal
with the rights and obligations of an employee organisation vis-a-vis the employees and that a new agreement might displace or alter those rights and obligations, but that is not the case here.

Whether an employee organisation which is not a bargaining representative has a right to be heard in relation to an application for the approval of an agreement will depend on the circumstances in each case. In this case, when the rights, interests or expectations asserted by the CFMEU are understood in the legislative context, it is clear that the CFMEU has not established any right, interest or legitimate expectation that would be adversely affected by the decision to approve the Agreement which would give it a right to be heard.

In the present case, as to the CFMEU’s first argument, at paragraph [12] of the CFMEU submissions, it submits:

Firstly, the CFMEU has a significant number of members employed by an associated entity of the applicant namely Spartan Mining Services Pty Ltd (Spartan). Spartan is a contracting company that operates in the coal industry. Spartan is not covered by any enterprise agreement. The approval of the Agreement will place immediate pressure on the wages and conditions of CFMEU members employed by Spartan. These employees of Spartan will face the prospect of accepting reduced wages and conditions. This will be achieved by the Agreement being used as a comparator by Spartan/the applicant or continued employment being conditional upon accepting employment with the applicant and consequently being covered by the Agreement. The only alternative to these options will be cease employment with Spartan.”

[18] The CFMEU, in further support of their case for permission to intervene, relied on the Decision of Deputy President Asbury in SRSW Pty Ltd, 5 which post-dated the Collinsville Decision. In that Decision, whilst the applicant in that matter similarly objected to the Union’s intervention, the Deputy President stated, in allowing the intervention by the CFMEU:

“I decided to allow the CFMEU to be heard in relation to the application for approval of the Agreement. I did so because prior to the communication from the CFMEU I had concerns about whether the requirements of the Act for approval of the Agreement had been met and whether the Agreement passed the better off overall test (BOOT).

Pursuant to s. 590 of the Act, the Commission has powers to inform itself in relation to any matter before it in a manner it considers appropriate. A small number of employees have made the Agreement; the Agreement operates in the Coal Industry where the CFMEU has a presence; I have concerns about the Agreement; and there is no contradictor in the application for approval. In those circumstances, it is in my view appropriate to allow the CFMEU to be heard in relation that application.”

[19] The authority of the Collinsville Decision is acknowledged. In this matter I also considered the powers pursuant to the broad discretion in s 590 of the Act and the intervention was granted on the facts and circumstances of this matter, with some similarities to the concerns held in the SRSW matter and having regard to the need to be fully informed of all the matters relevant to the approval of this Agreement.

The Better off Overall Test

[20] The remaining issues in relation to the Agreement as advanced by the Union, related to sections 185,186 and 187 of the Act. The Union raised a number of objections related to section 186(2)(d); the Better off Overall Test (BOOT). As per section 193, the BOOT is applied on a global basis 6 and in the current circumstances comparing the Agreement with the Black Coal Mining Industry Award 2010 (“the Award”).

[21] A Full Bench of the Commission, in Duncan Hart v Coles Supermarkets Australia Pty Ltd and Bi-Lo Pty Limited T/A Coles and Bi Lo; Australasian Meat Industry Employees Union, The v Coles Supermarkets Australia Pty Ltd and Bi-Lo Pty Limited T/A Coles and Bi Lo 7, recently observed as follows, in relation to the BOOT:

“…Section 193(1) of the Act provides that an enterprise agreement passes the BOOT if the Commission is satisfied, at the test time, that each award covered employee, and each prospective award covered employee would be better off if the agreement covered the employee than if the relevant modern award covered the employee. In this case the relevant modern award is the General Retail Industry Award 2010 8 (the Award). It is well established that the test requires the identification of terms which are more beneficial for an employee, terms which are less beneficial for an employee, and an overall assessment of whether an employee would be better off under the agreement9.”10

[22] In applying the BOOT test – and previously the no disadvantage test (NDT) – the consistent view of the Commission is that consideration is given to a comparison between the terms of the relevant award and the terms of the agreement 11.

[23] A provision of a proposed agreement that when considered alone, may be less beneficial than a corresponding provision in a relevant modern award, will not result in the proposed agreement failing the BOOT if there are other more beneficial provisions in the proposed agreement which offset the less beneficial provision such that employees are better of overall. It is well established that the BOOT (as with the NDT before it) is to be applied on a global basis rather than line by line.

[24] In order to properly apply the BOOT in the present case, it is necessary to construe the terms of the Black Coal Mining Industry Award 2010. The approach to the construction of Awards and relevant case law was extensively considered by a Full Bench of the Commission in AMIEU v Golden Cockerel Pty Ltd 12and relevant principles can be summarised as follows13:

The construction of an award, like that of a statute, begins with the consideration of the ordinary meaning of the words; 14

Regard must be paid to the context and purpose of the provision or expression being construed 15 including the legislative background against which it was made and in which it is to operate;16

A narrow, pedantic approach should be avoided and meanings which avoid inconvenience or injustice may reasonably be strained for; 17 and

The exercise is not one of giving effect to some anteriorly derived notion of what would be fair or just regardless of what is written in the Award. 18

[25] The Union took issue with a number of the provisions of the proposed Agreement, when compared with the Award. In undertaking the process of the BOOT assessment, the Applicants made reference to the following decisions relating to the BOOT determination:

“In AKN Pty Ltd t/a Aitkin Crane Services, 19 Hatcher VP, Watson SDP and Lee C relevantly stated of the BOOT (footnotes omitted):

[43] In the Full Bench decision in Armacell Australia Pty Ltd the requirements of the proper application of the better of overall test were described in the following way:

“[41] The BOOT, as the name implies, requires an overall assessment to be made. This requires the identification of terms which are more beneficial for an employee, terms which are less beneficial and an overall assessment of whether an employee would be better off under the agreement. The approach adopted by the Commissioner includes an identification of terms which might, on his view of the term, be less beneficial for an employee. There is nothing on the face of the Commissioner’s decision to indicate what account if any he took of any terms which might be more beneficial for an employee.”

[44] In the Decision, the Commissioner recognised at the outset that the ordinary rates of pay provided by the Agreement were significantly higher than those provided for in the three relevant modern awards. Then, in the way earlier explained, he identified various aspects of the Agreement which he considered to be less beneficial than the corresponding provisions of the relevant awards and which had not been satisfactorily addressed by the provisions of undertakings. However, in reaching the conclusion that the Agreement did not satisfy the better off overall test, the Commissioner did not explain how, in his overall assessment, the less beneficial provisions of the Agreement outweighed those which were found to be more beneficial. There was, for example, no analysis as to how employees generally or in particular categories or scenarios would fare financially under the Agreement as compared to the relevant award. And, in respect of the various aspects of the Agreement which were found to be less beneficial, the Commissioner appears to have taken the approach that the failure to provide an undertaking that addressed that particular aspect led to the Agreement as a whole failing the better off overall test without considering whether any deficiency in that respect might be outweighed by the other more beneficial provisions of the Agreement. This approach involved error of the type identified by the Full Bench in Solar Systems Pty Ltd, namely taking a line by line rather than a global approach to the application of the better off overall test.” 20

[26] The Union took issue with a range of the Agreement provisions, on the basis of which it argued the Agreement did not pass the BOOT.

[27] In dealing with the matters relevant to the approval of the Agreement provisions referred to by the Union and responded to by the Applicant, the Applicant also provided an Undertaking with their material, to remedy some of the issues raised by the Union.

[28] The Undertaking is extracted as follows:

“…the employer…

“1. For a part time employee referred to in clause 10:

a. At the time of the engagement of a part time employee, the employer and employee will in writing on a regular pattern of work, specifically at least the hours worked each day, which days of the week the employee will work and the actual starting and finishing times each day.

b. Any agreed variation to the regular pattern of work will be recorded in writing.

c. All time worked in excess of the hours as mutually arranged will be overtime and paid for at the rates prescribed in clause 14.2.”

2. Will not apply of enforce clause 18.3 in the case of any time worked by any employee covered by the Agreement, and shall treat the subclause as if it did not form any part of the Agreement and did not confer any rights or obligations on any person

3. In respect of clause 9.1 will average ordinary hours of work over the roster cycle.”

4. In respect of clause 16.1 will pay annual leave loading at the employee’s ordinary rate of pay plus a loading of 20% of that rate.”

5. Will give and explain to employees the policies and procedures referred to at clause 2.5, the policies to promote and maintain a safe workplace referred to at clause 6.2 and the Fitness for Work and Fatigue Management Policy referred to at clause 14.4.2, upon any such policy or procedure being developed by the employer.” 21

Policies and Procedures Incorporation - Civil Penalties for Breach

[29] Firstly, it was argued by the Union that, unlike the Award, the Agreement incorporates by reference a number of policies and procedures and the Union submitted that such incorporation meant that an employee who breached such policies or procedures was exposed to civil penalty for contravention of s.50 of the Act. The Union submitted that there was no equivalent provision in the Award.

[30] In response to the Union’s argument, the Applicant submitted that, at the time the Agreement was made, there were no policies or procedures of the Applicant as referred to in clauses 2.5, 6.2 and 14.4.2 of the Agreement. The Applicant submitted that no civil penalty could be imposed where there is no breach. Further, the Applicant argued that their Undertaking at point 5 deals with the provision of such policies and procedures when they are made.

[31] In the closing submissions at the hearing, the Union set out their position in relation to the incorporation of the policies and the Undertaking provided by the Applicant:

“… What we say is that the agreement, clause 6.2, the agreement clearly incorporates the applicant's policies of which the applicant says there are none. But it goes one step further, Commissioner, and incorporates the policies dealing with occupational health and safety that are specific to the mine site on which these employees work. So it incorporates, Commissioner, to use an example BMA's policies, specific to occupational health and safety.

… by incorporating the site policies, the employee is exposed to breach of the policies and therefore of the Fair Work Act if there is a breach of the site-wide policy.

So an employee who is working at a BMA site who breaches clause 14.4.2, who breaches the BMA fitness for work and fatigue management policy, has breached that policy, and because that policy has been incorporated into the enterprise agreement is also exposed to a civil penalty for breach of an enterprise agreement. The award, on the other hand does not incorporate the policies referred to at clause 6.2 or 14.4.2 of the enterprise agreement. That is why it's a BOOT issue.

Dealing with the undertaking, the undertaking that's been proposed at point five, doesn't address that BOOT concern. It doesn't address the concern that breach of those policies, and therefore exposure to breach of a civil remedy provision of the Fair Work Act, the employee is shielded against those consequences. All the undertaking requires is that the applicant will give and explain those policies. So it doesn't deal with the BOOT concern, Commissioner.” 22

[32] Clause 6.2 of the Agreement is as follows:

“6.2 The Employee agrees to carry out any instructions, policies and decisions made to promote and maintain a safe workplace required by relevant occupational Health and Safety legislation, including any further requirements specific to the Employer’s industry and workplace – even if not specified in the legislation.”

(underline added)

[33] Neither party referred to any case law as to whether exposure to civil penalty was a relevant consideration for the BOOT. I note the observations of Deputy President Sams in the Decision of Surf City Coaches Pty Ltd t/as Bus IT Queensland 23, as follows:

“[23] The Union submitted that cl 16 deals with a matter which is inappropriate for inclusion in an enterprise agreement. It refers to common law duties and obligations. Asbury C, dealt with a similar provision in Glen Eden Thoroughbreds Pty Ltd T/A Ray White Shailer Park [2010] FWA 7217 (‘Glen Eden Thoroughbreds’) where she agreed with Gooley C’s assessment in Smith & Nephew Pty Ltd [2010] FWA 2465. The Commissioners in both cases found that the exposure of employees to civil penalties for breach of the Agreement in respect of such provisions, was a relevant matter when considering whether the Agreement passes the BOOT.

[24] The applicant submitted the clause is a standard provision relating to confidential information found in many modern enterprise agreements. In the case of Glen Eden Thoroughbreds, Asbury C reviewed, amongst other things, a ‘confidentiality clause’, similar to the one envisaged in Clause 16 of the Agreement. At para [58], she considered that such a clause, which exposed employees to civil penalties, was a relevant matter for consideration of the BOOT. The applicant believed that the provision of a ‘confidential information’ clause is a matter relevant to the employment relationship and is an appropriate clause in the Agreement. In assessing the impact on the employees for the purpose of the BOOT, the applicant observed that the employees, particularly mechanics, drivers and clerks are remunerated well above the Award. An expectation not to contravene confidentiality is not an unreasonable outcome to impose upon employees in exchange for increased rates of pay. In any event, given the nature of the applicant’s business, the likelihood of an employee breaching the provisions of the clause, which might give rise to a financial penalty being imposed upon the employee, is very remote.

[25] In my view, it is not to the point that a confidentiality provision is a common law obligation of an employee and therefore inappropriate for inclusion in the Agreement. Many terms of enterprise agreements (and Awards for that matter) also have a common law foundation. Notice of termination and summary dismissal are two such terms which readily spring to mind. I do not consider, as a matter of law, that it is impermissible to include a confidentiality provision in an enterprise agreement on the grounds contended for by the Union.

[26] While I have my own doubts as to whether such a clause is a relevant matter for the purposes of the BOOT, even if it is, the unlikelihood of it ever being invoked to the detriment of an employee, is so remote as to it being a neutral consideration in the BOOT balancing exercise.”

[34] While the clause under consideration in the Deputy President’s matter was a confidentiality provision, it is clear that it has previously been held that exposure to civil penalties for breach of an Agreement is a relevant matter when considering whether the Agreement passes the BOOT. However, the Deputy President expressed his doubts as to this and also considered the likelihood of the clause ever being invoked to the detriment of an employee.

[35] At the time the Agreement was made, there were no policies or procedures of the Employer’s in existence that were incorporated into the Agreement, and therefore, no employee was exposed to a civil penalty for breach of such a clause at the time the application for approval was made, or will be exposed until such policies or procedures are developed.

[36] The potential breach of a workplace policy (that is not a policy of the Employer’s) that is incorporated into the Agreement provided a possible exposure to civil penalties for a breach of the Agreement. Point 5 of the Undertaking provided by the Employer does not relate to this BOOT issue. Therefore, it will be considered as a less beneficial term than the Award for the purposes of this analysis. However, in accordance with the authorities, given the remote likelihood of the invoking of civil penalties by the Employer, for breach of the Agreement, in relation to the incorporated policies, the weight afforded to this consideration will not be substantial, and must be considered in a global sense of the overall provisions of the Agreement.

[37] In addition, minimum weight is attributed to this objection in terms of the BOOT, given there were no policies or procedures at the time the Agreement was made and the Undertaking covers the provision and explanation of such policies and procedures when developed.

Clause 5 – Duties and Responsibilities

[38] Clause 5.1 of the proposed Agreement is extracted as follows:

“The Employee agrees to work diligently and to faithfully carry out all lawful directions according to their job description and any other duties the Employer may reasonably require. This may include other duties which are within the level of skill or competence of the Employee, and which it is safe for the Employee to perform.”

[39] The Union raised an objection to the above clause, alleging that it did not include the limitation on deskilling in relation to duties as the Award does. Clause 12 of the Award is extracted as follows:

“12. Employer and employee duties

12.1 An employee:

(a) must perform work as reasonably required by the employer; and

(b) must undertake training that the employer reasonably requires (which may include training to maintain their classification or acquire new competencies).

12.2 Where an employee does not perform work or undertake training in accordance with clause 12.1 the employee is not entitled to payment for that period.

12.3 An employer may direct an employee to carry out such duties as are within the limits of the employee’s skills, competence and training consistent with the respective classification structures of this award provided that such duties are not designed to promote deskilling and provided that the duties are within safe working practices and statutory requirements.”

(underline added)

[40] The Applicant argued that the actual wording of the Agreement provision guards against deskilling, given the wording simply requires employees to agree to work diligently and carry out all lawful directions according to their job description and any other duties the employer may reasonably require, which are safe and within their level of skill or competence. It is considered that the wording of the provision, when examined against the Award clause, provides a similar limitation on deskilling and does not affect the BOOT.

Clause 6 - Health and Safety in the workplace (OH&S)

[41] The Union objected to clause 6.5 on the basis that it was an intrusive and incredibly broad obligation on the employee and that there was no equivalent provision in the Award.

[42] Clause 6.5 is extracted as follows:

“If the Employee is temporarily under medication or any condition that may affect or limit their ability to carry out normal job tasks, they are to notify the Employer so determination can be made regarding the availability of alternative duties.”

[43] The Applicant argued that:

“Such a provision is reasonable given the industry concerned and protects the employee. The fact that there is no equivalent provision in the Award cannot reasonably mean this provision is reasonably detrimental to an employee.” 24

[44] It is noted that section 42(4) of the Coal Mining Safety and Health Regulation 2001 (Qld) provides that a coal mine’s safety and health management system must provide for “an obligation of a person to notify the site senior executive for the mine of the person’s current use of medication that could impair the person’s ability to carry out the person’s duties at the mine.”

[45] This provision is seen to be within the general duty of care obligations owed by both parties and is considered on a global sense of the provisions in accordance with the BOOT process, and does not provide for an overall deficiency under the Agreement.

Clause 7 – Personal Protective Equipment (PPE)

[46] The Union argues that Clause 7 of the proposed Agreement imposes obligations on employees, in regard to personal protective equipment, which are not provided for in the Award. This clause states:

“7. Personal Protective Equipment (PPE)

The Employer shall ensure that the Employee is supplied with suitable protective equipment.

Such equipment shall remain the property of the Employer and shall be replaced by the Employee if lost or destroyed through negligence; provided that reasonable facilities are made available by the Employer for the safe keeping of such equipment.

Should any equipment be lost, stolen, broken, damaged or require replacement, the Employee must immediately report to these concerns to their immediate supervisor.

If replacement of PPE is required through wear and tear the Employee is to return the old item before a new item will be issued.”

[47] I concur with the Applicant’s explanation of this provision:

“Such a provision is reasonable given the industry concerned and protects the employees. The fact that there is no equivalent provision in the Award cannot reasonably mean this provision detrimental to an employee.” 25

Clause 8 – Employee Classifications (Casual and Fixed Term Employment)

[48] The Union took objection to clauses 8.1.3 and 8.1.4 which provide for the engagement of casual and fixed term employees under the Agreement. Clause 8.1 of the Agreement is extracted as follows:

“Employees will be employed in one of the following categories:

8.1.1 Full time Employee;
8.1.2 Part time continuing Employee;
8.1.3 Casual Employee;
8.1.4 Fixed term Employee”

[49] The Union’s specific objection was that clause 10.1 of the Award does not provide for the engagement of fixed term employees, or for casual employees other than staff employees. Clause 10.1 is extracted as follows:

“10.1 An employer may employ an employee in any classification included in this award in any of the following types of employment:

(a) full-time;

(b) part-time; or

(c) in the case of classifications in Schedule B—Staff Employees, casual.”

[50] The Award provides as follows for casual employees:

“10.4 Casual employment

(a) A casual employee is one engaged and paid as such.

(b) A casual employee, for working ordinary hours, will be paid 1/35th of the appropriate weekly rate, plus 25% instead of the leave entitlements under this award, with a minimum four hours payment on each engagement.

[51] The Union submitted, with respect to clause 10.1(c) of the Award, that an employer could only engage staff employees and not casual production and engineering employees under the Award. The Union recognised that the provisions for casual employment under the Agreement were similar to the entitlements under the Award for staff employees employed on a casual basis (at Clause 10.4 of the Award).

[52] Further Directions were issued in relation to the matter of casual employment under the Agreement, specifically, how the employment of production and engineering employees as casuals affects whether these employees are better off under the Agreement.

[53] The Applicant filed further submissions on 24 June 2016. The Applicant noted that Casual employees under the Sparta Agreement are provided with entitlements similar to those for casual Staff employees under the Award but submitted that the Sparta Agreement provided for additional entitlements for casual employees, which are outlined as follows:

clause 14.1.2 of the Agreement provided a minimum engagement for any employee of 4 hours.

clause 14.1.3 of the Agreement provides for penalty payments depending upon the day of the week when ordinary hours of work are performed

clause 14.2.1 of the Agreement provides for overtime payments.

clause 17 of the Agreement provides for unpaid carers, unpaid compassionate, community service and long service leave for casual employees.

the rates of pay for casual employees is the base rate for their classification plus a loading of 25% for all ordinary time worked

casual employees working shift work will receive the shift penalty in addition to the casual penalty of 25%.

Clause 23 of the Agreement provides for pay rates that are 5% higher than the comparable Award classification from the commencement of the Agreement (with an increase made on 1 July each year in proportion to annual increases in the minimum wage); and

Clause 24 and the Schedule to the Agreement provide that any applicable allowances are also increased by 5%.

[54] Therefore, it was submitted that Production and Engineering employees on a casual basis would be better off overall than they would under the Award.

[55] The Applicant submitted that each Award covered employee, and each prospective Award covered employee, for the Sparta Agreement, would be better off overall if the Sparta Agreement applied to the employee than if the Award applied to the employee, even considering the discrete issue of the ability of the Applicant to engage Production and Engineering employees on a casual basis.

[56] Further, the Applicant submitted that the fact that the ability to engage Production and Engineering employees on a casual basis, is an operational flexibility is not and cannot be a reason to not approve the Sparta Agreement.

[57] The Union filed their submissions in response on 28 June 2016. The Union submitted that an employee engaged under the Award only (on either a full-time or part-time basis) is entitled to those very same (or equivalent) terms as those which were cited as a benefit by the Applicant. For example, the Union submitted that clause 14.1.3 of the Agreement merely reflects clause 21.2 of the Award, in relation to penalty rates. These are identical entitlements.

[58] Further, the Union submitted that clause 14.2.1 of the Agreement reflects the overtime rates contained in clause 17.2 of the Award. These are identical entitlements to those contained in clauses 17.2 and 27.4 of the Award. The Union submitted that the Applicant was wrong to suggest that casual employees derive any benefit from clause 14.2.1 of the Agreement, as the entitlement to overtime is contingent on the employee working in excess of their ordinary hours of work. Unlike a full-time employee (see clause 14.1.1 of the Agreement), it was submitted that a casual employee engaged under the Agreement has no ordinary hours. The effect of this, the Union submitted, is that a casual employee engaged under the Agreement is never entitled to receive overtime pay consistent with clause 14.2.1 of the Agreement. The Unions submitted that this was a clear detriment as a result of the Agreement making provision for casual employees, as full-time employees and part-time employees engaged under the Award have a clear entitlement to receive overtime pay.

[59] With respect to Clause 23.5 of the Agreement (the entitlement to shift loadings for casuals), the Union submitted that this entitlement reflected clause 22.2 of the Award. These rates are the same.

[60] The Union submitted that, in respect of clause 14.1.2 of the Agreement (minimum engagement), Clause 10.3(b) of the Award is clearly more beneficial to a part-time employee than simply providing a minimum engagement period of 4 hours. The Award does not provide a minimum engagement period or a clause similar to clause 1 0.3(b) in relation to a full-time employee, and it was submitted to be “inconceivable” than a full-time employee would be rostered to work a shift of less than 4 hours.

[61] It was submitted by the Applicant that the entitlement provided to a casual employee by the Agreement to unpaid carers, compassionate and community service leave merely reflected the National Employment Standards, and that an award covered employee (on either a full-time or part-time basis) is entitled to paid personal/carer's leave, paid compassionate leave and paid community service leave if undertaking jury service.

[62] With respect to clause 17.4 of the Agreement, the Union submitted that it does not provide casual employees with an entitlement to long service leave and that the (minimum) entitlement that all employees in the coal industry have to long service leave is the result of the Coal Mining Industry (Long Services Leave) Administration Act 1992.

[63] The Union submitted that the loading of 25% needed to be considered against all of the entitlements and benefits enjoyed by a full-time or part-time employee engaged under the Award- paid leave, redundancy pay, notice of termination and the like -that such a casual employee is not entitled to receive.

[64] Under the Award, the employer can only engage an employee on a full-time or part-time basis. The Union submitted that full-time or part-time employment under the Award provides employees with a significant degree of predictability and certainty about how much work they will be doing in a particular week and when that work will be performed and that a casual employee under the Agreement has no such predictability or certainty over their working life.

[65] The Union submitted that there were protections afforded to full-time and part-time employees by clause 13.4 of the Award and s.117 of the Act. However, a casual employee under the Agreement can be terminated with one hour's notice (clause 11.2 of the Agreement).

[66] The Union submitted that a further detriment arises in that a casual employee engaged under the Agreement may be barred from a making an unfair dismissal claim (that a full-time or part-time employee engaged under the Award with the same period of service with an employer would be able to make).

[67] It was submitted that the lack of predictability and certainty over working life and the lack of job security is clearly detrimental to a casual employee under the Agreement, when compared to a full-time or part-time employee engaged under the Award.

[68] No persuasive submissions or evidence was provided regarding the effect of the provision for casuals in the Agreement.

[69] It is noted that there are a series of other enterprise agreements where causals have been engaged, where the Black Coal Mining Industry Award does not provide for such. The CFMEU has also been party to such agreements 26. It is considered that the engagement of casuals under the Sparta Agreement, with the 25% loading applied to the higher base rate, than the Award, is not a disadvantage in terms of the BOOT.

[70] With respect to fixed term employees, the Applicant emphasised that the reference in Clause 14.2(b) of the Award, relating to Redundancy, contemplates the engagement of fixed term employees under the Award. Clause 14.2 is extracted as follows:

“14.2 Definition of redundancy

(a) An employee is made redundant where an employee’s employment is terminated at the employer’s initiative:

(i) because the employer no longer requires the job done by the employee to be done by anyone except where this is due to the ordinary and customary turnover of labour; or

(ii) because of insolvency or bankruptcy of the employer.

(b) This clause does not apply to employees engaged for a fixed term or a specified task.”

(underline added)

[71] The Award does envisage the engagement of employees for a fixed term under Clause 14.2(b). I do not consider the employment of fixed-term employees as detrimental for the purposes of the BOOT in this case.

Clause 9 – Full Time Employee

[72] The Union also in terms of the BOOT took issue with Clause 9.1 of the Agreement that allows full time employees’ ordinary hours to be averaged over a 52 week period, in contrast to Clause 21.1 of the Award that provides for ordinary hours to be averaged over the roster cycle. Pursuant to section 190(3), the Employer provided an Undertaking to accommodate this objection as follows:

“…the employer…

3. In respect of clause 9.1 will average ordinary hours of work over the roster cycle.” 27

[73] It is considered that this Undertaking remedies any BOOT issues.

Clause 10 - Part Time Employee

[74] The Union also objected to the proposed Agreement, on the basis that it made no provision for part time employees benefits as per clauses 10.3(b),(c) and (d) of the Award. The Union stated that these Clauses provide for employees to earn overtime rates for part time workers. The Agreement, at Clause 10.1, provides that part time employees will be entitled to the pro-rata entitlements of full time employees. The Applicant responded to the objection by providing the following Undertaking:

“1. For a part time employee referred to in clause 10:

b. Any agreed variation to the regular pattern of work will be recorded in writing.

c. All time worked in excess of the hours as mutually arranged will be overtime and paid for at the rates prescribed in clause 14.2.” 28

[75] Accordingly, the Undertaking provides for the Award provisions in Clauses 10.3 (b) to (c) and the overtime rates as set out in Clause 10.3(d).

Clause 13 - Probationary Period

[76] The Union took issue with the six month probationary period provided for in the Agreement given that there was no equivalent provision in the Award. Clause 13.1 of the Agreement provides:

“Employment is subject to a probationary period of six (6) months. During the probationary period the Employer may end the employment at any time by giving the applicable notice period required.”

[77] The Applicant responded by recognising that such provision was not in the Award, but considered that employment on probation not to be an unusual occurrence.

[78] It is considered that this provision does not differ substantially from an Employer’s right under the Award to dismiss an employee with the applicable notice.

Clause 14.2 - Overtime

[79] In addition, the Union objected to clause 14.2.1 of the Agreement, which is extracted as follows:

“Employees agree to work reasonable rostered overtime and non rostered overtime if required…”

[80] The Employer submitted that they are seeking employees to agree to work reasonable rostered overtime and non-rostered overtime, if required, and that such a provision is similar to clause 17.4 of the Award. The Union argued that the Award only provides that the Employer may require an employee to work reasonable additional hours and the employee may refuse to work additional hours. The Award states as follows:

“17.4 Reasonable additional hours

Subject to the NES, an employer may require an employee to work reasonable additional hours in addition to their rostered hours and be paid the applicable overtime rates.”

[81] The Union argued that “the right of refusal finds its way into the Award courtesy of the NES” 29. Section 62 of the Act, containing the NES provisions relating to maximum weekly hours of work, is as follows and provides at subsection (2) “The employee may refuse to work additional hours (beyond those referred to in paragraph (1)(a) or (b)) if they are unreasonable”.

[82] The Applicant argued that one cannot contract out of a provision of the NES and that the NES provides an ability to refuse to work particular additional hours. The Applicant submitted that there was no issue in relation to Clause 14.2.1.

[83] By virtue of section 55(1) of the Act, a modern award or enterprise agreement must not exclude the National Employment Standards or any provision of the National Employment Standards. Therefore, the right of refusal to work beyond 38 hours per week contained in the NES, continues to apply to employees under the Agreement.

Clause 14.3 – Pattern of work

[84] In addition, the Union argued that Clause 14.3.1 of the Agreementis less beneficial than Clause 23.4(b) of the Award on the basis of the terms in relation to underground mines, that designate the start and finishing place will be on the surface.

[85] Clause 14.3.1 of the Agreement is extracted as follows:

“Days of work, start and finish times, shift lengths and breaks between shifts will be as agreed between the Employer and Employee, provided that:

14.3.1.1 not more than ten (10) hours of ordinary time may be worked on any day; and

14.3.1.2 not less than ten (10) hours break shall be allowed between shifts (not including any travelling time).”

[86] Clause 23.4(b) of the Award states as follows:

“23.4 Starting and finishing places

(a) The starting and finishing place of a shift are to be agreed between the employer and the majority of affected employees or, in the absence of agreement, as determined in accordance with the dispute resolution procedure.

(b) At underground mines, the designated starting and finishing place will be on the surface.”

[87] The Union submitted that while the Agreement provided for agreed days of work, start and finish times, shift length and breaks between shifts, the Agreement was silent on the start or finish place or location. The Award, however, provides for agreement on the start and finishing place of a shift. The Union argued that as the Agreement did not deal with the matter of start and finishing locations, the Employer would have discretion as to where the employees started and finished their shifts. Mr Walkaden gave the following example of how this could affect employees:

“…the employer could say the start and finish time is 3 pm; but, for example, you could be underground at that particular point in time under the agreement or you could be sitting on a machine in an open cut mine and have to travel some distance back…” 30

[88] The Applicant submitted that there was a minor difference in the provisions.

[89] It is considered that the Agreement is less beneficial than the Award in respect of the start and finish locations of shifts. The Award provides for an agreement to be reached in respect of the start and finishing places, whereas the Agreement does not provide for such agreement. However, no evidence or submissions were made in relation to quantifying this in terms of lost wages or whether payment would only be made in respect of designated shift times. The absence of the provision for agreed start and finish locations was not demonstrated to be a major deficiency in terms of the consideration for the BOOT.

Clause 13.5 – Roster changes

[90] It is noted that the Union, in their written submissions, argued that Clause 35.5(ii) of the Award was more beneficial in that it provided for overtime rates to be paid when less than one week’s notice of a roster change was given. However, at the hearing the Union confirmed that they were not pursuing this argument 31.

Clause 14.4 – Meal and rest breaks

[91] The Agreement at Clause 14.4.2 provides that employees will not work for more than five hours without taking a break unless extenuating circumstances exist and in accordance, with the site ‘Fitness for Work’ and ‘Fatigue Management Policy’ 32. The Undertaking at 5 (as previously set out) deals with the provision of these documents to employees.

[92] Clause 24.3 of the Award requires agreement to work more than five hours without a break, and provides that any work beyond five hours will be paid at the applicable overtime rates until a meal break is taken, unless otherwise agreed. Clause 24 of the Award states as follows:

“24. Meal breaks—rostered hours

24.1 An employee is entitled to a meal break of 30 minutes without deduction from pay for each five hours worked during rostered hours.

24.2 Subject to clause 24.3, an employee will not be required to work for more than five hours without a meal break.

24.3 Where the employer and employee agree that the employee will work for more than five hours without a break, then the employee will, unless otherwise agreed, be paid for any work beyond five hours at the applicable overtime rates until a meal break is taken.”

[93] The Union’s argument is that the requirement under the Award, for an agreement, between the employee and the employer, for an employee to be able to work more than 5 hours without a break, is a superior entitlement than that under the Agreement.

[94] Further, the Union argued that there is no provision for overtime payments after 5 hours work without a break under the Agreement (unless agreed otherwise), unlike the Award.

[95] Mr Walkaden argued as follows:

“…the enterprise agreement at clause 14.4.2 provides a less beneficial entitlement because the reference there is you can be required to work more than five hours if there are extenuating circumstances and subject to whatever is said in the site Fitness for Work and Fatigue Management Policy. Clearly there is no provision for overtime pay. There is an inferior entitlement in relation to those matters.” 33

[96] The Applicant submitted that overtime payment under the Award is not absolute in that another agreement (to work for more than five hours without a break) can be made between the Employer and the employee. Further, the Applicant submitted that the Undertaking at point 5 provides for the provision and explanation of the Fitness for Work and Fatigue Management Policy when developed.

[97] The Union argued that point 5 of the Undertaking only required the Applicant to give and explain the policies and it does not deal with the BOOT issue of the ability to refuse to work overtime and the payment of overtime rates.

[98] It is considered that clause 14.4.2 is a relevant consideration for the BOOT as a term that is less beneficial than the Award. However, it must be noted that under the Coal Mining Safety and Health Regulation 2001 (Qld), the development of a fitness for work policy must be developed in consultation with a cross-section of workers in developing the fitness provisions.

Clause 15 – Stand Down

[99] The Union argued that the Agreement at Clause 15.1.1, by virtue of the words 'because of a stoppage of work, including but not limited to...' increases the ability of the Applicant to stand down employees without pay in circumstances where the Award does not contain a stand down clause.

[100] Clause 15.1 of the Agreement states:

“The Employer may stand the Employee down without pay if:

15.1.1 The Employee cannot be usefully employed because of a stoppage of work, including but not limited to, as a result of adverse weather, client directive, mining incident, strike, mining conditions or a breakdown of machinery through any cause whatsoever.”

[101] Section 524 of the Act is as follows:

“524 Employer may stand down employees in certain circumstances

(1) An employer may, under this subsection, stand down an employee during a period in which the employee cannot usefully be employed because of one of the following circumstances:

(a) industrial action (other than industrial action organised or engaged in by the employer);

(b) a breakdown of machinery or equipment, if the employer cannot reasonably be held responsible for the breakdown;

(c) a stoppage of work for any cause for which the employer cannot reasonably be held responsible.

(2) However, an employer may not stand down an employee under subsection (1) during a period in which the employee cannot usefully be employed because of a circumstance referred to in that subsection if:

(a) an enterprise agreement, or a contract of employment, applies to the employer and the employee; and

(b) the agreement or contract provides for the employer to stand down the employee during that period if the employee cannot usefully be employed during that period because of that circumstance.

Note 1: If an employer may not stand down an employee under subsection (1), the employer may be able to stand down the employee in accordance with the enterprise agreement or the contract of employment.

Note 2: An enterprise agreement or a contract of employment may also include terms that impose additional requirements that an employer must meet before standing down an employee (for example requirements relating to consultation or notice).

(3) If an employer stands down an employee during a period under subsection (1), the employer is not required to make payments to the employee for that period.”

[102] The Union argued the Agreement clause was broader as the limitation in sections 524(b) and (c) of the Act “if the employer cannot reasonably be held responsible” is not found in the Agreement clause.

[103] The Applicant submitted that the Act permitted broader circumstances for standing down employees than the Award and referred to the Decision in Australian Federation of Air Pilots v Australian Helicopters 34, in which Commissioner Simpson extracted from the Explanatory Memorandum in relation to section 524 of the Act:

“[8] The Explanatory Memorandum provides;

2080. An enterprise agreement or a contract of employment may provide for stand down in a wider range of circumstances than as provided in this Part (subclause 524(2)). If an enterprise agreement or a contract of employment does not provide for stand down, or authorises stand down in more limited circumstances, or does not deal with one of the specified circumstances in subclause 524(1), then the provisions for stand down set out in this Part will apply.”

[104] The Applicant further argued that the circumstances described in clause 15.1 of the Agreement, by their nature, are those for which the Applicant could not reasonably be held responsible.

[105] It is noted however, that the Agreement clearly states “through any cause whatsoever” which may encompass situations where the employer could be reasonably held responsible. Mr Walkaden gave an example in relation to mining conditions as follows:

“…If the mining conditions were such that the employee could not be usefully employed and if those conditions were the result of a decision by the applicant, the employees could be stood down under the enterprise agreement but not under the award and section 524(1)(c) of the Act.

That is because if the mining conditions were attributable to the actions of the employer, the employees could not be stood down as per section 524(1)(c) of the Act because the mining conditions are a cause for which the employer could be held responsible.” 35

[106] Further, the Union argued that section 524(1) of the Act prescribes that an employee could only be stood down in circumstances that met subsections (a) to (c), whereas the Agreement clause states “including but not limited to”. It was argued by Mr Walkaden that the only condition that needed to be established under the Agreement, for an employee to be stood down without pay, was that the employee cannot be usefully employed.

[107] It is considered that the circumstances in which an employee may be stood down are broader under the Agreement than the Act. Whilst the provision may be considered less beneficial than the Award, it is not considered that the circumstances of the stand down are as broad as argued by the Union.

Clause 16 – Leave for Full Time and Part Time Employees (Annual Leave)

[108] In addition, the Union argued that the Agreement at Clause 16.1.4 only provides for the payment of annual leave at the base rate, whereas it was set out that the Award at Clause 25.7 provides a more beneficial entitlement.

[109] Clause 25.7 of the Award is extracted as follows:

“25.7 Payment for annual leave

An employee taking annual leave must be paid either:

(a) the employee’s ordinary rate of pay plus a loading of 20% of that rate; or

(b) the employee’s rostered earnings for the period of annual leave, which includes all rostered overtime and rostered public holidays (paid at double time), but does not include shift allowances, other than for seven day roster employees;

whichever is the greater.”

[110] The Employer provided an Undertaking in respect of clause 16.1.4, which states as follows:

“…the employer…

4. In respect of clause 16.1 will pay annual leave loading at the employee’s ordinary rate of pay plus a loading of 20% of that rate.” 36

[111] The Union argued that the Undertaking only provides for the 20% loading, and did not deal with seven-day roster workers whose projected roster could be expected to exceed a 20% loading 37.

[112] With the provision of the Undertaking at Point 4, Clause 16.1.4 is no longer less beneficial when compared with Clause 25.7(a) of the Award.

[113] However, the Award provides for a potentially higher payment of annual leave under 25.7(b), depending on the roster of the particular employee. No evidence or submissions were brought or made as to how much higher this amount could be.

[114] Accordingly, the absence of the entitlement for employees to be paid the higher annual leave amount under clause 25.7(b) of the Award is a less beneficial term, but of minimum weight, when considered against the increased wage rates in the Agreement.

[115] The wording of the Undertaking at Point 4 should read as follows; In respect of clause 16.1 will pay annual leave ~~loading~~ at the employee’s ordinary rate of pay plus a loading of 20% of that rate. This is further dealt with in the Conclusion.

[116] Further, the Union argued that Clause 25.8 of the Award provided flexibility as to when annual leave is paid which is absent under the Agreement.

[117] Clause 25.8 of the Award is extracted as follows:

“25.8 When payment will be made for annual leave

An employee will be paid for a period of annual leave in accordance with the employee’s normal pay period(s), unless an employee requests that payment of the entire period of annual leave be made prior to the employee commencing leave.”

[118] The Union also argued that the entitlement to take annual leave in advance under the Award was absent under the Agreement. Clause 25.9 of the Award provides for this entitlement as follows:

“25.9 Taking annual leave in advance

(a) An employer may allow an employee to take annual leave in advance.

(b) Any annual leave which has been taken in accordance with clause 25.9(a) will be deducted from the employee’s entitlement as it accrues.

(c) The employer may deduct from the employee’s termination pay the payment for any annual leave taken in advance which the employee has not yet accrued in accordance with clause 25.3.”

[119] The Applicant submitted that there was no Agreement equivalent to clauses 25.8 and 25.9 of the Award, but argued that the Applicant had discretion to allow an employee to take annual leave in advance. The Union argued that it appeared the Applicant had conceded that the Agreement entitlement is less beneficial than the Award clauses.

[120] With respect to Clause 25.8, it is considered that under the Award, an employee has an entitlement to be paid for the entire period of annual leave prior to the annual leave if they request such before the commencement of the leave. This is an entitlement which is absent from the Agreement and the absence is less beneficial than clause 25.8 of the Award.

[121] However, Clause 25.9 of the Award confers a discretion on an Employer to allow the taking of annual leave in advance. There is no automatic entitlement to taking annual leave in advance for an employee under this Award clause. In the absence of a clause related to taking annual leave in advance in the Agreement, the Applicant has discretion to allow the taking of annual leave in advance. Accordingly, it is considered a neutral consideration in terms of the BOOT.

Clause 18 – Site Requirements

[122] Clause 18.3 of the Agreement sets out:

“In the event the client withdraws an Employee’s site access for whatever reason, the Employer has cause to terminate the Employee’s employment.”

[123] The Union argued that this clause significantly undermines an employee’s protections at work and that there was no equivalent provision in the Award.

[124] The Employer provided an undertaking in relation to this Clause as follows:

“…the employer…

[125] It is considered that this Undertaking renders the clause neutral for the purposes of the BOOT.

Payment of Wages (frequency and upon termination)

[126] The Union argued that the Agreement makes no provision for the frequency of payment of wages, and as such, wages are to be paid in accordance with s.323 of the Act:

“323 Method and frequency of payment

(1) An employer must pay an employee amounts payable to the employee in relation to the performance of work:

(a) in full (except as provided by section 324); and

(b) in money by one, or a combination, of the methods referred to in subsection (2); and

(c) at least monthly…”

[127] The Union submitted that Clause 16.4 of the Award provided for wages to be paid weekly. The Applicant emphasised that the default position under the Act was that payments must be made at least monthly.

[128] The Union further submitted that the Clause 16.7 of the Award provides for the payment of all wages due, within 72 hours of termination of employment. There is no equivalent to Clause 16.7 in the Agreement, and the Union argued that, because of the default payment under s.323 of the Act, an employee whose employment had been terminated would have to wait one month for such payment.

[129] The Applicant argued that this did not mean that an employee would have to wait a month, rather, that the requirement under the Act was for payments to be made at least monthly.

[130] The Applicant did not indicate how often it intended to pay its employees, however, it was recognised that the minimum required payment frequency (as per the Act) was at least monthly. Accordingly, this is considered a neutral consideration for the BOOT.

Other BOOT considerations

[131] In undertaking the BOOT analysis, the Applicant submitted that there was a 5% increase in the pay rates and allowances in the proposed Agreement above those in the Award.

[132] The Union stated that the increases in wage rates under the Agreement compared with the Award were as follows:

Level 1 – 4.79%

Level 2 – 4.78%

Mine worker – 4.76%

Mine worker advanced – 4.78%

Mine Worker Specialist/Leading hand – 4.76%

[133] The Applicant provided a table as Annexure LJ9 to the Affidavit of Mr Jansen.

[134] The Applicant also submitted that Clause 7, relating to personal protective equipment, and Clause 14.1.2, providing a minimum engagement for four hours per engagement were more favourable than the Award. The Applicant also clarified their argument, in relation to their written submissions 39, that clause 16.1.10 of the Agreement provides for cashing out of annual leave, which is not an entitlement under the Award40.

[135] The Union argued that the PPE clause imposed additional obligations on employees, leaving them worse off. This argument has been considered and, as stated above, this clause is considered neutral for the purposes of the BOOT.

[136] The Union also argued that there was no real benefit for a minimum engagement of four hours, because a permanent employee was guaranteed 35 hours (averaged over the roster cycle with the provision of the undertaking) and that the only real benefit would be for casual employees, and in relation to production and engineering employees, it was the Union’s submission that engagement as a casual would be a detriment in any event, as the Award does not provide for casual engagement in those classifications.

[137] The Union referred to Question 3.4 of the Form F17 Employer’s Statutory Declaration, and the answer given by Mr Jansen that Clause 11 was more beneficial than the Award. Clause 11.3 of the Agreement states that “an employee may be deemed and treated as a casual employee even though their employment may be regular and systematic.”

[138] The F17 states that this clause “provides for casual production employees who work regular rosters”. The Union argued that this clause did not provide a benefit to the employee and Mr Walkaden argued that this clause appeared “…to suggest that an employee who may otherwise be considered to be a full-time employee and entitled to the benefits of full-time employment in terms of leave, redundancy rights, et cetera, will actually be disguised as a casual employee.”

[139] It is considered that this clause does not provide a benefit to a casual employee, contrary to the F17 and is a matter to be considered for the BOOT.

[140] The Undertaking provided by the Employer addresses the majority of the less beneficial clauses. Other clauses are neutral or of minimal disadvantage.

[141] In summary, and taking into account the Undertaking provided by the Employer, the following Agreement clauses have been identified as less beneficial than the Award:

Policies and Procedures Incorporation – Exposure to civil penalties for breach of policies and procedures incorporated in the Agreement

Clause 11.3 – An employee may be deemed and treated as a casual employee even though their employment may be regular and systematic.

Clause 14.3 – Pattern of work – No agreement on Start and Finishing Place of shifts (Employer discretion)

Clause 14.4 – Meal and rest breaks – No ability to refuse to work more than 5 hours without a break, and no overtime payment for work for longer than 5 hours without a break.

Clause 15 – Stand Down – Circumstances in which an employee can be stood down are broader than the Award.

Clause 16 – Leave for Full Time and Part Time Employees (Annual Leave) – Payment rate under Award provides for higher payment of annual leave depending on roster – Undertaking dated 4 May 2016 only provides for ordinary rate plus 20% loading.

Clause 16 – Leave for Full Time and Part Time Employees (Annual Leave) – No entitlement to payment of annual leave before leave commences if requested by an employee prior to such leave.

[142] Also taking into account the Undertaking, the following clauses raised by the Union were found to be irrelevant or neutral for the purposes of the BOOT:

Clause 5 – Duties and Responsibilities

Clause 6 - Health and Safety in the workplace (OH&S)

Clause 7 – Personal Protective Equipment (PPE)

Clause 8 – Employee Classifications (Casual and Fixed Term Employment)

Clause 9 – Full Time Employee - with the provision of the Undertaking dated 4 May 2016.

Clause 10 - Part Time Employee - with the provision of the Undertaking dated 4 May 2016.

Clause 13 - Probationary Period

Clause 14.2 - Overtime

Clause 16 – Leave for Full Time and Part Time Employees (Annual Leave) – Taking Annual Leave in advance

Clause 18 – Site Requirements - with the provision of the Undertaking dated 4 May 2016.

Payment of Wages (frequency and upon termination)

[143] The increased wage rates and the ability to cash out annual leave under the Agreement are more beneficial than the Award.

[144] Taking into account the Undertaking provided by the Employer on 4 May 2016, and the more beneficial provisions, the Agreement passes the Better off Overall Test.

Undertakings

[145] A number of the Union’s concerns have been remedied by the Undertakings provided by the Employer. However, the Union argued that the Undertakings provided by the Employer resulted in substantial changes to the Agreement, and therefore could not be accepted. Mr Walkaden stated as follows:

“…the undertaking that's already been proposed results in substantial changes to the agreement and therefore cannot be approved. If a further set of undertakings was to be proposed, then the applicant would be embarking upon the course at the Full Bench in AKN Services - I forgot the actual reference, I've got it with me, I know the employer has provided a copy. It's AKN Pty Ltd. The applicant is Crane Services decision. I can take you to it if required.

…

Expressly cautions against and says in short terms that the giving and the offering of undertakings is not a negotiation process and that the applicant doesn't get a number of bites at the cherry to get it right. I can deal with that if required. That's why an undertaking is not suitable in the circumstances.” 41

[146] Section 190(3) of the Act is extracted as follows:

“…

(3) The FWC may only accept a written undertaking from one or more employers covered by the agreement if the FWC is satisfied that the effect of accepting the undertaking is not likely to:

(a) cause financial detriment to any employee covered by the agreement; or

(b) result in substantial changes to the agreement.”

[147] The Union indicated that the issue was that the Undertakings in aggregate terms resulted in substantial changes to the Agreement, but that there was no issue with some of the Undertakings provided in isolation. For example, the Undertaking at Point 3 relating to averaging of ordinary hours allayed the Union’s BOOT concerns 42, as did Point 1 of the Undertaking relating to overtime for part-time employees43. It also appears that the Union’s only issue with Point 2 of the Undertaking, relating to the treatment of Clause 18.3, as if it did not form part of the Agreement, was in the aggregate terms44 of the Undertaking. However, Points 4 and 5 of the Undertaking did not remedy the Union’s BOOT concerns, in relation to annual leave45 and civil penalty for breaches of the Agreement46. These matters however, have been dealt with in the Decision.

[148] The Union accepted that the Undertaking given by the Employer will not cause financial detriment to the employees. The Union relied on a Decision by Deputy President Gostencnik in Kore Construction Pty Ltd 47 (Kore Construction) which is extracted as follows:

“[30] An undertaking which is intended to overcome concerns about whether an agreement passes the better off overall test will often need to take the form of varying the operation of the agreement, for example, by undertaking that a term of the agreement which provides a disadvantage when compared with the relevant modern award will not apply or will apply in a particular way. Once an undertaking is accepted by the Commission and an agreement is approved, the undertaking will have that effect because it will become a term of the agreement. An undertaking that is expressed as varying a particular provision in a proposed agreement should be taken to be a promise by the employer that a particular term in an agreement about which concern has been expressed, will not be applied and the term as set out in the undertaking will be applied. Moreover the fact that section 190 itself requires that a written undertaking not “result in substantial changes to the agreement” 9, suggests that minor changes to an agreement resulting from a written undertaking are permissible. To view the proposed written undertakings as a variation to an agreement rather than an undertaking within the meaning of section 190 of the Act merely because of the expression used in the undertakings is to adopt an unnecessarily technical approach to the giving undertakings and is not one that is warranted when regard is had to the express requirements of the form and effect of an undertaking that are set out in sections 190 and 191 of the Act.

[31] It is clear from the nature of the proposed undertakings that each seeks to address that which what might be perceived as financial disadvantage under the Agreement when compared to the modern award. With the exception of the undertaking in relation to superannuation, each of the remaining proposed undertakings provides for a financial improvement in the position of particular employees that will be covered by the Agreement. I am therefore satisfied the undertakings offered will not cause any financial detriment to any employee that will be covered by the Agreement.

[32] I have given a great deal of consideration to whether the undertakings that are offered should be accepted. Clearly the undertakings are designed to ensure that the Agreement, when read with the undertakings, would pass the better off overall test. However when one examines the proposed undertakings in their entirety it is clear that, taken as a whole, the undertakings result in substantial changes to the Agreement. The undertakings do not merely propose minor alterations to the Agreement or clarify the operation of the Agreement. They involve changes to the wage rates attached to classifications in the Agreement, the inclusion of substantive new provisions into the Agreement, and the inclusion of substantive allowances not previously provided for in the Agreement. The proposed undertakings are therefore not accepted.”

(underline added)

[149] With respect to the Sparta Agreement and the Undertaking provided by the Employer, the Union argued that Point 1 of the Undertaking provided for a new entitlement or capacity for part-time employees to earn overtime under the Agreement. Mr Walkaden submitted that an identical provision was considered by the Deputy President in Kore Construction.

[150] Further, it was argued by the Union that Undertaking 2 removed clause 18.3 which was a significant provision, and that Undertaking 3 in relation to averaging ordinary hours was a significant change. It was argued that Point 4 of the Undertaking provided for a “new allowance”, that is, a new method of calculation for annual leave.

[151] The Applicant also referred to the Decision in Kore Construction and submitted that the Undertakings provided by the Applicant were distinguishable from those in that Decision, like “chalk and cheese” 48. The Applicant argued that Point 2 of the Undertaking (relating to clause 18.3) was not a significant matter and that Point 3 of the Undertaking (averaging of ordinary hours) does not significantly change what the employees agreed to.

[152] With respect to Point 4 of the Undertaking (payment of annual leave), the Applicant submitted that the Undertaking provided an additional entitlement to the payment of annual leave, and in respect of Point 5, the Applicant argued that this Undertaking was in relation to Sparta Policies that had not been developed at the time the Agreement was made. The Applicant also argued that the Undertaking at Point 1 was a clarification of Clause 10.1 of the Agreement, which entitles part-time employees to pro rata entitlements of full-time employees.

[153] The Applicant submitted the Commission has a reasonably broad discretion under s.190(3) and that the Undertakings provided would not have the effect of resulting in substantial changes to the Agreement.

[154] The current Undertaking can be distinguished from that in the Kore Construction Decision above given that the current Undertaking does not involve changes to the wage rates or substantive changes to the Agreement.

[155] It is not considered the Undertakings provided by the Employer in this matter offend s.190(3) in that they do not have the effect of providing substantial changes to the Agreement.

Other Approval Considerations (Non BOOT)

s.180(2) - Material Incorporated by Reference

[156] With respect to the material incorporated by reference, the Union submitted that the following was not provided to the employees and that this resulted in non-compliance with section 180(2) of the Act:

The Applicant’s policies and procedures (Clause 2.5 of the Agreement)

All State and Commonwealth industry codes of practice (Clause 6.1 of the Agreement)

All policies made to promote and maintain a safe workplace including any requirements specific to the applicant’s industry and workplace that are not specified by legislation (Clause 6.2 of the Agreement)

The site Fitness for Work and Fatigue Management Policy (Clause 14.4.2 of the Agreement)

[157] Section 180(2) of the Act is extracted as follows:

“…

Employees must be given copy of the agreement etc.

(2) The employer must take all reasonable steps to ensure that:

(a) during the access period for the agreement, the employees (the relevant employees) employed at the time who will be covered by the agreement are given a copy of the following materials:

(i) the written text of the agreement;

(ii) any other material incorporated by reference in the agreement; or

(b) the relevant employees have access, throughout the access period for the agreement, to a copy of those materials.”

[158] The Union stated that the Agreement included reference to a number of policies and procedures as per clauses 2.5, 6.2 and 14.4.2 of the proposed Agreement and argued that the Employer had not taken all reasonable steps to ensure that the employees were given or had access to material incorporated by the Agreement during the access period.

[159] The Applicant argued that, at the time of making the Agreement, Sparta held no policies and procedures. However, in relation to this matter the Employer provided an Undertaking as follows:

“…the employer…

[160] The Applicant submitted as follows in relation to the requirement that employees are given, or have access to material incorporated by reference in the agreement during the access period:

“70. The evidence of Mr Jansen is that the policies and procedures of the Applicant referred to at clauses 2.5, 6.2 and 14.4.2 of the Sparta Agreement were not prepared at the date of the Sparta Agreement was made 50. Thus, there was nothing that could have been given to the affected employees.

71. The undertaking provides that the Applicant will give and explain to the employees the policies and procedures referred to in clauses 2.5, 6.2 and 14.4.2 of the Sparta Agreement when they are developed.

72. The material referred to at clause 6.1 of the Sparta Agreement, with which the Applicant agrees to comply - the State and Commonwealth Occupational Health and Safety Laws and relevant industry codes of practice – are available in the public domain and are freely available. In this regard, there was compliance with section 180(2) of the Act. 51

73. Similarly, the material referred to at clause 6.2 of the Sparta Agreement with which the employees agree to comply, namely, Occupational Health and Safety legislation are available in the public domain and are freely available.”

[161] In relation to policies or produces that were specific industry or workplace policies (clause 6.2), or site policies (Clause 14.4.2), Mr Walkaden argued as follows:

“ The only point we respond to is that my friend raised in relation to compliance with section 182, in relation to clause 6.2 and clause 14.4.2, and it appeared to be suggested that the task that's put against the applicant would have been an onerous task in that it appeared to be suggested that the effect of our submission would be the employer would be required to provide every single policy in Central Queensland.

That submission isn't correct and it is an exaggeration. What the Act requires, section 182, is the employer take all reasonable steps. So it's not a strict requirement to provide each and every single document that has been incorporated.

…
THE COMMISSIONER: So if after approval they say, "These employees are going to be working at this particular site", isn't it reasonable that that's the time that they're provided with those site-specific policies?

MR WALKADEN: What we say is that the application of section 182 requires a judgment on your part as to whether the steps taken- - -

…were reasonable or not. And that discretion must be exercised in the circumstances at the time of approval. And at the time of approval, there were three employees working at two mine sites. To suggest that each and every single policy document in issue across each mine in Central Queensland must have been provided, pursuant to this requirement, isn't right.

The scope or the breadth of the obligation is quite specific in that it could only possibly contemplate the two policies, the Fatigue Management policy and the Fitness For Work Policy referred to at clause 14.4.2 of the agreement, as well as the site-specific…

…you need to be concerned, Commissioner, because it's a statutory command that the employer must take all reasonable steps to provide incorporated material. And as I'm explaining, the breadth of the obligation isn't as large as has been suggested. It's restricted to those two policies at those two mine sites, as well as any site-specific policies at those two mine sites that go over and above the mine-site owner's obligation to health and safety, as referred to at clause 6.2 of the agreement. So that's the breadth.

And in making your decision about whether the steps taken were reasonable, you're not required to find that the employer was required to provide each and every single document within the scope of those documents to these three employees. You're required to make a determination about the steps the employer did take was reasonable. And we say there was no steps taken and that results in non-compliance with the provision.

So it's not an onerous requirement in circumstances where there are only three employees. If there were 3,000 employees, Commissioner, working across 40 different mine sites, you would be required to exercise your judgment about whether the employer in those circumstances, was required to provide each of those 50 or 40 mine sites, Fitness for Work procedures. But here, it's quite a narrow obligation – three employees at two mines.

That's the extent of the obligation, that's the range of documents that could be provided and you're just required to exercise a judgment about whether the steps taken were reasonable or not, and we say they weren't.”

[162] Mr Merrell argued in relation to this point as follows:

“The second issue is in relation to the undertakings given about the matters other than the laws of the land. The submission was, well, the propositions that are in McDonald's and the NTEU case don't extend to things such as codes of practice. I know that the Commission is familiar with those types of instruments in work place health and safety matters.

Those sorts of instruments are generally speaking statutory instruments, that is they are instruments that are paid pursuant to some sort of health and safety legislation that are freely available on the internet. If the proposition from McDonald's and the NTEU is that the laws of the land are available on the internet then codes of practice are available on the internet as well and as a result those types of codes of practice, in addition to occupational health and safety laws are laws of land, no issue is taken with that. But codes of practice made or statutory instruments made pursuant to occupational health and safety legislation are statutory instruments available on the internet and for the same reasons given in McDonald's and the NTEU about the laws of the land, they are in the public domain, that is the codes of practice are in the public domain.” 52

[163] It is noted that section 42 of the Coal Mining Safety and Health Regulation 2001 (Qld) provides that a coal mine’s safety and health management system must be developed in consultation with a cross-section of workers in developing the fitness provisions, and that a site senior executive must make a reasonable attempt to establish any criteria for the assessment of workers provided for in the fitness provisions in agreement with a majority of workers at the mine, or a recognised standard applies.

[164] The absence of Sparta policies and procedures at the time of making the Agreement have been considered, in addition to the further Undertaking on this issue:

“5. Will give and explain to employees the policies and procedures referred to at clause 2.5, the policies to promote and maintain a safe workplace referred to at clause 6.2 and the Fitness for Work and Fatigue Management Policy referred to at clause 14.4.2, upon any such policy or procedure being developed by the employer.” 53

[165] The Union has not justified that the Employer has not complied with sections 180(2) or 188(1)(a) of the Act in terms of provision of or explanation of policies and procedures at the time of making the agreement, as the employer entity did not have such at that time. In addition, the relevant Undertaking remedies this matter.

s.180(5) – Agreement terms explained

[166] The Union argued that the Applicant had failed to comply with the pre-approval step of explaining the Agreement’s terms. Section 180(5) is extracted as follows.

“…

Terms of the agreement must be explained to employees etc.

(5) The employer must take all reasonable steps to ensure that:

(a) the terms of the agreement, and the effect of those terms, are explained to the relevant employees; and

(b) the explanation is provided in an appropriate manner taking into account the particular circumstances and needs of the relevant employees.”

[167] Mr Jansen provided evidence as to how the proposed Agreement was explained to the employees, in addition, reference was made to the document that forms attachment LJ-5 to his Affidavit, entitled ‘Subject Line: Explaining the Proposed Enterprise Agreement’. This document was provided to employees. It provided some additional explanation to the matters relevant to the Agreement.

[168] Mr Merrell summarised Mr Jansen’s evidence in relation to this point as follows:

“…The evidence of Mr Jansen was that he allowed - in respect of some of the non-contentious clauses or the easier clauses, the employees read them, in respect of others he read them out.

His evidence generally was there were no questions raised by the employees. If the employees have been given a copy of the agreement and they've had some clauses read to them or they've read some clauses themselves and they haven't asked any questions that would, in my respectful submission, satisfy any concern that the provisions of the agreement have been explained because in many cases the agreements are self-explanatory, the provisions in the agreement rather are self-explanatory. So we say that that particular issue is not a matter that assists the union in this particular case.” 54

[169] I am satisfied that the Applicant took reasonable steps to explain the terms of the Agreement to the employees.

Full and Frank Disclosure

[170] The Union submitted that the Applicant had failed in its duty to fully and frankly disclose all relevant matters to the Commission 55, by declaring in the Form F17 Statutory Declaration that the Agreement did not contain any terms less beneficial than the Award.

[171] The evidence provided by Mr Jansen, Human Resources Manager for Sparta Mining Services Pty Ltd, was that he mistakenly answered ‘No’, to Question 3.5 of the Form 17 Annexure. However, the attachment LJ-9 (provided with his Affidavit of evidence) contained a table, which indicated where the Agreement was more favourable than theAward and a comparison of the provisions of the Award and Agreement.

[172] I am satisfied that the answer No was in error, and that the Applicant has acknowledged, in their evidence, that the Agreement does contain terms less beneficial than the Award. The Applicant provided further detailed evidence of the comparison of terms for the BOOT.

Conclusion

[173] As per the process adopted in Duncan Hart v Coles Supermarkets Australia Pty Ltd and Bi-Lo Pty Limited T/A Coles and Bi Lo; Australasian Meat Industry Employees Union, The v Coles Supermarkets Australia Pty Ltd and Bi-Lo Pty Limited T/A Coles and Bi Lo 56, the Commission, when undertaking the BOOT, is required to identify the terms which are more beneficial for an employee, terms which are less beneficial for an employee, and make an overall assessment of whether an employee would be better off under the Agreement.

[174] Accordingly, with the Undertaking as provided by the Employer, I am satisfied that the pre-approval steps were met and that the Agreement, on a global basis, (as per the reasons provided in relation to each of the provisions considered above) meets the Better off Overall Test, that is, employees would be better off under the Agreement, and therefore, the Agreement is capable of approval.

[175] However, an error has been identified in the Undertaking provided by the Employer dated 4 May 2016. In Point 4 of those Undertakings, the Undertaking should read In respect of clause 16.1, will pay annual leave (omit “loading”) at the employee’s ordinary rate of pay plus a loading of 20% of that rate. Accordingly, the Undertaking document is to be amended and provided to my Chambers as soon as possible.

[176] Subject to the receipt of the amended Undertaking document, I intend to approve the Agreement, by separate decision.

COMMISSIONER

Appearances:

Mr J. Merrell, Counsel, instructed by Mr S. McSwan of Mackays Solicitors for Sparta Mining Services Pty Ltd

Mr. A. Walkaden, Legal Officer, for the CFMEU

Hearing details:

2016:

Brisbane

May 16.

1 Transcript 16 May 2016 PN99 per Mr Walkaden.

2 [2014] FWCFB 7940.

3 Applicant’s Submissions, paragraph 6.

4 Applicant’s Submissions.

5 [2015] FWC 994.

6 WorkPac Mining Pty Ltd [2016] FWC 251 at [106] – [107].

7 [2016] FWCFB 2887.

8 MA000004.

9 AKN Pty Ltd t/a Aitkin Crane Services [2015] FWCFB 1833; Armacell Australia Pty Ltd and others [2010] FWAFB 9985; National Tertiary Education Union v University of New South Wales [2011] FWAFB 5163; Solar Systems Pty Ltd [2012] FWAFB 6397.

10 [2016] FWCFB 2887 at [6]

11 Re MSA Security Officers Certified Agreement 2003 PR937654; BUPA Care Services Pty Ltd [2010] FWAFB 2762; Mondex Group Pty Ltd [2015] FWC 1148; Agri Labour Australia Pty Ltd [2015] FEC 5332; MP Resources Pty Ltd [2015] FWC 6820; Samphie Pty Ltd t/a Black Crow Organics [2010] FWAA5060; Top End Consulting Pty Ltd [2010] FWA 6442.

12 [2014] FWCFB 7447 at [19] – [22].

13 Brockfield Enterprises Pty Ltd and Ors[2015] FWC 7863

14 City of Wanneroo v Australian Municipal Clerical and Services Union (2006) 153 IR 426.

15 Ibid.

16 Amcor Limited v Construction, Forestry, Mining and Energy Union (2005) 222 CLR 241.

17 Kucks v CSR Limited (1966) 66 IR 182.

18 Ibid.

19 [2015] FWCFB 1833;(2015) 248 IR 12.

20 Applicant’s submissions, paragraph 19-20.

21 Signed Undertaking of Sparta Mining Services Pty Ltd dated 4 May 2016.

22 Transcript 16 May 2016 PN565-PN569 per Mr Walkaden.

23 [2014] FWC 3028.

24 Applicant’s submissions, paragraph 27.

25 Applicant’s submissions, paragraph 29.

26 Application by Wambo Coal Pty Limited for approval of the Peabody Energy Australia Wambo Open Cut Enterprise Agreement 2015 [2015] FWCA 8474; Application by Ready Workforce Pty Ltd for the approval of the Chandler Macleod Gunnedah Basin Coal Mining Agreement 2014 [2014] FWCA 5789; Application by JR Engineering Pty Ltd / JR Conveyors Pty Ltd for approval of the JR Engineering Pty Ltd / JR Conveyors Pty Ltd South/Western District Workplace Enterprise Agreement 2016 [2016] FWCA 3173.

27 Signed Undertaking of Sparta Mining Services Pty Ltd dated 4 May 2016, undertaking 3.

28 Signed Undertaking of Sparta Mining Services Pty Ltd dated 4 May 2016, undertaking 1.

29 Transcript 16 May 2016 PN625 per Mr Walkaden.

30 Transcript 16 May 2016 PN637 per Mr Walkaden.

31 Transcript 16 May 2016 PN647 per Mr Walkaden.

32 These policies had not been agreed at the workplace at the time the Agreement was made. Clauses 2.5, 6.2 and 14.4.2 refer to policies which are the subject of Undertaking 5.

33 Transcript 16 May 2016 PN656 per Mr Walkaden.

34 Australian Federation of Air Pilots v Australian Helicopters[2013] FWC 7863 at [8] .

35 Transcript 16 May 2016 PN664 – PN665 per Mr Walkaden.

36 Signed Undertaking of Sparta Mining Services Pty Ltd dated 4 May 2016, undertaking 4.

37 Transcript 16 May 2016 PN669 per Mr Walkaden.

38 Signed Undertaking of Sparta Mining Services Pty Ltd dated 4 May 2016, undertaking 2.

39 Outline of Submissions on Behalf of Sparta Mining Services Pty Ltd dated 5 May 2016 at paragraph 63(b)(iii).

40 Transcript 16 May 2016 PN798 per Mr Merrell.

41 Transcript 16 May 2016 PN582-PN584 per Mr Walkaden.

42 Transcript 16 May 2016 PN603 – PN604 per Mr Walkaden.

43 Transcript 16 May 2016 PN608 per Mr Walkaden.

44 Transcript 16 May 2016 PN683 per Mr Walkaden.

45 Transcript 16 May 2016 PN669 per Mr Walkaden.

46 Transcript 16 May 2016 PN569 per Mr Walkaden.

47 [2014] FWC 1955.

48 Transcript 16 May 2016 PN811 per Mr Merrell.

49 Signed Undertaking of Sparta Mining Services Pty Ltd dated 4 May 2016, undertaking 5.

50 Paragraphs 40 to 43 of Mr Jansen’s affidavit.

51 McDonalds Australia Pty Ltd v Shop, Distributive and Allied Employees Association[2010] FWAFB 4602 at [43] per Watson VP, Kaufman SDP and Raffaelli C and National Tertiary Education Industry Union v University of New South Wales [2011] FWAFB 5163:(2011) 210 IR 244 at [19] to [28] per Harrison SDP, Sams DP and Deegan C.

52 Transcript 16 May 2016 PN801 - PN802 per Mr Merrell.

53 Signed Undertaking of Sparta Mining Services Pty Ltd dated 4 May 2016.

54 Transcript 16 May 2016 PN799 - PN800 per Mr Merrell.

55 The Union referred to the Decision in AFMEPKIU v AWU & EDL & Anor, Print M9753, 1 March 1996.

56 [2016] FWCFB 2887.

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